Average gross household income by wards

Gross 'median' household income 2014

Summary

Analysis of the gross median household income results for 2014 reveals that for the Lancashire County Council area, the figure was £26,600. The broader Lancashire 14-authority area, which includes the two unitary authorities, recorded a noticeably lower average of £25,700. In comparison, the North West average for 2014 was £25,900 whilst the GB figure was £28,500.

Ribble Valley and Chorley had the highest median income results in the county, whilst Fylde, South Ribble and West Lancashire were the other Lancashire authorities with averages that were either above or on a par with the national figure. Blackpool, and the four East Lancashire authorities of Blackburn with Darwen, Burnley, Pendle and Hyndburn recorded the lowest median results.

The yearly change results reveal a worrying picture of growing disparities between the most and least affluent parts of the county. The highest yearly rates of increases were seen in the three most affluent Lancashire authorities. , whilst five of the authorities that recorded yearly decreases occupied the lowest five positions.

The distribution at the ward level confirms that the wealthiest wards in Lancashire are in rural/suburban areas close to the major population centres in the county. They are also locations from which people can easily commute to Manchester or Liverpool. Pennine ward in Chorley district, with a median income between £49-50,000, has easily the highest average in the county.

The yearly change results at the ward level dramatically emphasises the point of growing disparities. 19 of the 20 wards with the lowest median incomes recorded yearly reductions, whilst 19 of the 20 with the highest results saw yearly increases.

Introduction

This research article details estimates of gross household income before tax (including earnings, investment income and welfare payments) down to the ward level. The information is derived from the ‘paycheck’ system, which is managed by the private sector consultancy group CACI. Please note that confidentiality restrictions prohibit the full disclosure of the exact figures, and the forwarding of the original dataset to third parties.

Paycheck uses information on millions of households from CACI’s lifestyle database, along with census and market research data to increase reliability. This allows robust household income figures to be produced for Lancashire districts and wards.

Lancashire County Council has acquired the 2014 gross household income details for all the wards and local authorities in the 14-authority Lancashire area. The information has been selectively used in this report to highlight areas of wealth and income deprivation within the county, and changes over the past year.

Previous editions of this article gave the mean (average) figures the most prominence, but in the 2014 update we have decided to focus much more on the 'median' results but still mention the mean figures for Lancashire local authorities. The median income value represents the mid-point along the range of incomes in a particular area. Fifty percent of households will be distributed below the median income value and 50% above the median level. Median results are more reflective of the ‘typical’ income, and have the advantage over mean income data as they are less influenced by extreme values within the distribution of income data. Table 1 indicates that the median figures are noticeably lower than the mean results.

The Lancashire results (median household income)

For the Lancashire County Council area, which excludes Blackburn with Darwen and Blackpool unitary authorities, median (typical) household income for 2014, was £26,600. The broader Lancashire-14 area, which includes the two unitary authorities, recorded a noticeably lower figure of £25,700. In comparison, the North West average was £25,900 whilst the GB figure was much higher at £28,500. The results reveal a median household income figure for the Lancashire County Council area that is ahead of the regional average, but it is somewhat behind the GB figure. The result for the 14-authority Lancashire area is affected by low median results for the two unitary authorities.

Figure 1. Median (middle-value) income by Lancashire local authority, 2014

Figure 1 reveals that at the national level, the median income figure increased by 1.6%, and there was a 0.5% rise for the Lancashire County Council area. A noticeable yearly reduction in Blackburn with Darwen and a yearly fall in Blackpool meant that the 14-authority area saw a 2.1% decline.

Ribble Valley is the most prosperous authority in Lancashire with Chorley in second place. South Ribble and Fylde were the two other Lancashire authorities that recorded median household income results that were above the national average. West Lancashire had a figure that was on a par with the GB result. The three authorities with the highest median results recorded the largest yearly increases in the county. In comparison, the five Lancashire authorities that had the lowest median results all recorded yearly decreases.

Income covers all forms of financial gains, and the effects of particular salary changes in various sectors of the economy, differentials between public and private sector earnings, income from assets such as shares and rent, farm incomes, changes in returns from private and state pensions, and welfare benefits for people of working age, all have specific effects that impact on the overall results. The article on working age benefits reveals the percentages of working age people in Lancashire authorities that are reliant on certain benefits. Those with the lowest and highest rates, are not surprisingly the authorities that occupy the same or similar positions on the median income scale (see figure 1).

* Confidentiality restrictions preclude the publication of the exact figures at the local authority level.

Household income information measures wealth by area of residence therefore the more urbanised districts are likely to see some of the wealth generated in their area lost to the more rural districts that are popular with commuters. The inward migration of wealthy retired/semi-retired individuals will also augment a district’s average gross income figure.

The rural Ribble Valley district is a popular location to live and commute elsewhere to work. West Lancashire is a good base for commuting to Merseyside, whilst Rossendale benefits from its location to the north of Manchester. Chorley and South Ribble are suitable locations for commuters to either Manchester or Preston. In contrast, commuting patterns work against areas such as Blackpool, Blackburn, Burnley and Preston, which on balance tend to have more inward than outward commuters.

Mean gross household income

Table 1 also includes results for mean income levels. These averages are skewed by high earners that lead to figures that are well above the median incomes.

The 2014 ward results indicate that Pennine ward in Chorley district, with a median income between £49-50,000, easily has the highest average income in Lancashire (Table 2).In second place was North Turton with Tockholes, a predominantly rural area to the south of Blackburn. Parbold, in an affluent area of West Lancashire district was third

The most affluent wards in the county are in rural/suburban areas that are close to the major urban centres. These represent popular areas for commuting to the core urban areas in Lancashire, and to neighbouring areas including Manchester or Liverpool. To the north of the county around Lancaster, the rural wards are somewhat more isolated and do not benefit to such a large extent from affluent commuters. In contrast, Ribble Valley has seven of the wards in Lancashire with the highest average incomes.

Table 2. The 20 wards with the highest average (median) gross household income in the broader Lancashire, 2014

* Confidentiality restricts preclude publication of the exact numbers at the ward level.

Table 3 reveals that of the 20 wards with the lowest average figures, six were in Blackburn with Darwen, four in Preston and the remainder in Blackpool, Burnley, Hyndburn and Pendle.

Blackburn with Darwen authority had particularly large disparities between the highest and lowest median ward income levels figures, whilst Preston is also represented among the most and least affluent wards.

The yearly change figures at the ward level highlight a particularly worrying pattern of growing disparities. In total, 19 of the 20 wards with the lowest median incomes recorded yearly reductions, whilst 19 of the 20 with the highest results saw yearly increases.

Table 3. The 20 wards with the lowest average (median) gross household income in the broader Lancashire sub-region, 2014